Telcos spend more than $600 million snapping up 5G friendly spectrum

Australia’s largest telcos have spent more than $600 million on crucial radio wave spectrum that will help them build 5G networks and dramatically improve mobile and internet speeds.

Telstra spent $276.6 million on buying 1000MHz of 26GHz spectrum, which is highly sought after because it can be used to build high-speed mobile networks. TPG Telecom will pay $108.2 million for licences in Sydney, Melbourne, Brisbane and Perth, while Optus was awarded licences in most capital cities for $226.2 million by the Australian Communications and Media Authority. Including smaller providers Dense Air Australia and Pentanet Limited, the group of telcos spent $647.6 million.

More than $600 million was spent by the telco industry at the latest spectrum auction.
More than $600 million was spent by the telco industry at the latest spectrum auction. Credit:AP

“Just imagine you are stuck in traffic at rush hour and suddenly 50 more lanes open up,” Telstra chief executive Andrew Penn told The Sydney Morning Herald and The Age. “[Spectrum] gives you so much more capacity to be able to let the data flow through.”

Mr Penn said the spectrum would allow the $40 billion telco giant to invest in building standalone 5G networks for specific industries such as mining.

“We are talking with a number of miners about building their own 5G private network on a mine location where they can provide connectivity. They do that…because to try and automate the mine with robotics they need sensors infused in everything, but that then needs to be communicated,” Mr Penn said.

The acquisition of the spectrum will also lead to a wider rollout of 5G fixed wireless services, which are considered an alternative to the NBN.

“If we can provide a better solution using 5G than they are able to get with NBN technology… that’s exactly what we do,” Mr Penn said.

His views were shared by TPG Telecom chief executive Iñaki Berroeta, who declared the outcome a good development for shareholders.

“The spectrum will enable us to deliver 5G fixed wireless services as a compelling NBN alternative, and it will also benefit mobile services in high foot-traffic areas such as CBDs,” Mr Berroeta said.

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This month’s auction marked the first time the 26GHz radio wave spectrum was made available. The licences will come into force for 15 years within months. A second auction for the 850MHz/900MHz bands will occur later this year. The telco industry believes that improving network coverage will eventually generate a boost in revenue.

Optus’ managing director of networks Lambo Kanagaratnam said the spectrum would have large benefits for businesses.

“For enterprise, this spectrum could support remote controlled automation, for example robotics in a warehouse or factory, or the creation of a secured private network at a university campus to support thousands of students and academics,” he said. “In short, we are armed with the ability to build and expand our 5G network and deliver on the future of 5G in the home, office or on-the-go.”

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Source: Thanks smh.com